Before starting the topic, you should know that what paid collection is, so the paid collection is an account that went into the collections because it was past due that was paid later. The bad news is that the paid collection account can harm your credit score badly. It can reduce more than 100 points, so it isn’t a piece of cake, seriously it’s need effort. If you have paid the past collections, so you already take a responsible/positive step to boost your credit score. Unsurprisingly, you want to witness diminishing of your credit report altogether. Now, we come back to the topic, so the question is that “How to remove paid collections from a credit report,” and the answer is hidden in basically 5 proven powerful strategies which make it happen:
- Dispute if it’s incorrect
- Pay for remove
- Dispute if it’s been sold
- Goodwill deletion
- Take time
Now, it is time to describe these strategies properly.
Suggested Read: Can You Use a Credit Card at ATM?
Dispute if It’s Incorrect
In the beginning, you should find that if the paid collection actually belongs to you.
It can surprise you that only 1 out of 5 customers has incorrect details about credit reports; that’s why don’t suppose that everything in your report is valid. Fair Credit Reporting Act (FCRA) needs weighty bureaus to present only valid information on your credit reports.
To look over the faults, begin by ordering a copy of your free credit report and start to examine your report very carefully. And highlight any fault you can appeal for free credit reports by your annual credit report.
Now, you can dispute errors with credit bureaus individually.
Pay For Remove Paid Collections From a Credit Report
What do you think once you pay a collection account, it’s gone forever,
wait a moment; it’s not that much easy.
If the original collection agency sold your loan to another collection agency, so in that case, you will be dealing with two different negative things: original loan or debt which can be called “chargeoff,” or you can say that paid collection.
So what is the term “Pay-For-Delete.”
Basically, pay for delete is when the loan/debt collector removes the paid collection from your credit report. On the other hand, in return, you are paying off the account.
The pay for delete can work for the present holders of the debt/loan. The original collection agency has already removed your loan, or you can say that your debt is from its book, which means there is no reason to work with you to remove it.
But if you have other loans, or you can say those other debts with the original debt agency, you are still able to negotiate a pay-for-delete agreement. In exchange for solving the remaining debt, It never hurt to ask for the collection agency to remove the chargeoff items.
If you select this way, first make sure that you present everything in a written form and also get the written confirmation from the creditor as well as the credit bureau.
Dispute if It’s Been Sold
It is very common for the debt collection agency to sell debts if they cannot collect them. It means the collection agency which is listed on your credit report is different from the agency as once you paid when you fix your loans.
If the old collection agency still appears on your credit report, you can disagree with the items; it is not often for this kind of item to appear on one or two credit bureau reports.
That’s the reason it’s important to examine your credit report from all three credit bureaus.
Ask for a goodwill deletion is that you have a very good business relation with your customer, so it might be possible that your customer favors you in your dark times like that in some cases if you don’t have any past due because you paid all credit payments on time, so it is thinkable that the creditor will agree to remove paid collections from your credit report, but this scenario ensues in some cases.
The possibility of a goodwill deletion occurs in very rare cases, but there is nothing bad to try.
Here I am going to share a quote:
“If you never try, you will never know.”
What do you think?
So for asking for a goodwill deletion from the original creditor, here are tips:-
This strategy involves that you write a letter to your lender/creditor. In this letter, you need to clarify your state of condition, and you would like to remove the paid collections from your credit report.
You can also share your past experience if you ever faced financial hardship in the past, so explain how it disturbed your potential to stay with your responsibilities.
Remember that, be professional and courteous, the creditors(like credit card issuers) legally don’t have any need to remove the paid collections, but they can do it anyway, so the professional, respectful and sincere letter can do the trick.
Take Time to Remove Paid Collections From a Credit Report
Despite your best efforts, sometimes the creditor simply denies removing the paid collections from the credit report (don’t be sad); the good news is coming soon, and the good news is that it’s better to have a paid collections on your credit report rather than an unpaid item.
If you can’t persuade the creditor to remove the paid collections from your credit report, so there is one thing which you can do, you can wait for the negative information, which is to drop off your credit report, which is almost seven years from the date of original delinquency.
During this, you can work to increase/boost your credit score in other ways because it is highly affected by your irresponsibilities. Now the question is that what are those ways by mean of them you can boost your credit score. You should make payments on time to gain the trust for next time and working to improve your debt-to-income ratio.
Ok, so now we talk about the scenario which you should know since above we addressed that work to boost your credit score, the question arises how you can boost your credit score?
There are some important factors that can reduce your credit score (like late payments, skipped payments, etc…). The account that gets to the collection stage is considered extremely delinquent and will have a negative impact on their credit report.
To boost your credit score, there are no fixed points if the paid collections are removed from your credit report.
Therefore, if the paid collection affected your credit score lowered by 100 points, and getting it can increase your score by 100 points too.
Paid collections and unpaid collections both act for an extremely delinquent account. It shows a very negative effect on your credit. In short, it drops off your credit score instead of boost, and creditors don’t want to give money to those who have bad records of repaying their loan except some.
If you don’t want to wait 7 years to drop off your credit report, so you are thinking about removing the paid collection from your credit report.
You have several ways to remove the wrong collection from your credit report. If the paid collection was perfect/valid, so you can think about asking your creditor for goodwill deletion. If everything goes wrong, you have to wait till the paid collections drop off your credit reports. At that time, your credit score will retrieve.